daytrade diaries... december 11&12, page-27

http://www.theage.com.au/business/link-no-chip-off-computershare-block-20091212-kpnk.html

Link no chip off Computershare block
CHRISTOPHER WEBB
December 13, 2009

THE share registry business is not all beer and skittles judging from the results of the private equity-owned Link group.

As investors who peruse their holding statements would know, Link is a competitor of industry giant Computershare, but it appears to have a way to go before it reaches the latter's profitability.

Accounts just to hand for the 2009 fiscal year show that Link Administration Holdings remained deeply in the red, losing $21.2 million before tax, compared with a $22.7 million loss previously.

The accounts include various registry operations in South Africa, Papua New Guinea, India and, of course, Australia. Employee numbers were 1888.

The activities are conducted through Link Market Services, which booked lower earnings, to wit, $10.7 million, compared with $12.3 million on sales that fell by 8.3 per cent to $104 million. Employees totalled 533.

Link's owner, Pacific Equity Partners, may plan to cash in on the improvement in investor sentiment by floating the share registry operation.

How that would be achieved with results such as the ones reported are unclear, although stripping out what Link directors refer to as ''certain acquisition and restructuring items'' improves the results.

In the case of Link Administration those adjustments transform the $21 million loss into earnings of $33 million, while over at Link Market Services similar adjustments increase earnings from $10.7 million to $31 million.

Explaining they wanted to enhance understanding of the operating result, the directors said that the adjusted figures reflected earnings from core operations.

Meanwhile, the debt level in the parent company's balance sheet was slightly lower.

Debt stood at $424 million, and interest costs of $42 million affected the result rather nastily.

Abandon scrip
PACIFIC Brands scrip has run out of puff and some of the parties that more than doubled their money have moved on to the next conquest. The big moment for punters was when the company earlier this year decided to issue shares at one-third of the levels prevailing a year earlier.

There were plenty of takers for the scrip, among them David Paradice's fund management operation. Soon after the issue, Paradice emerged with close to 6 per cent of the register at a 72¢-a-share average price.

Pocketing $1.30 for a decent chunk of stock, Paradice has moved off the substantial shareholder register. The shares last fetched $1.235.

Cries of 'timber'
JOHN Gay, the chief at Gunns, is reducing his stake in the timber group. He has cut his stake in the company by 45 per cent, with the disposal of 3.4 million shares.

He collected 91¢ for the shares a few days ago and the price remains around that level.

That wasn't the only loosening of his share ownership ties with the Tasmanian-based group.

A few months ago the company raised cash through an issue, and it appears Gay didn't put cash into it.

But for every seller there's a buyer. Investors Mutual has stepped up to the plate and bought into the relatively friendless stock.

The fund manager has accumulated 42 million shares, more than 5 per cent of the register.

Investors Mutual bought its latest lot of shares for about 97¢, or 13 times historical earnings.